December 14th, 2018 - Issue #947

In This Issue

1. Trading 101: Free, Interactive Futures Trading Tutorial
2. Hot Market Report: Natural Gas what a Ride!!
3. Economic Calendar

Our friends over at Futures.io are fundraising for families living in Ecuador in need of basic necessities for the holidays!

1. Trading 101: Free, Interactive Futures Trading Tutorial

An interactive tutorial on the basics ( and a little more) of futures trading.

2. Hot Market Report: Natural Gas what a Ride!!

Click on image below to enlarge

When we talk about price moves among the many commodity futures available for trading, we often focus on outsize price moves because they illustrate extremes in opportunity and risk you can find in trading commodity futures. Over the course of this entire year, large downward moves in stock indexes (Feb. and all of Q4), crude oil (25% drop in Oct.-Nov) have taken center stage. Lesser-known moves have been the near-40% slide in sugar (Mar.-Aug.) and coffee’s continued plunge – a close to 50% price drop – going back to early 2017. But none of these compares to this year’s league-leading ±40% breakout in natural gas in the span of a dozen trading sessions (Oct. 30 – Nov. 14). In terms of dollar-value moves, the Jan. futures contract gained over $17,000 per contract. To put this in perspective, the same dollar value move in the E-mini ($5) Dow futures contract would be a 3,400-point move. Adding to its stand-out performance, as of this newsletter’s release, and since its Nov. 14 high, the Jan. nat. gas contract has sold off more than $11,000 per contract – again, that’s a 2,200-point move in the E-mini ($5) Dow.

Per the Energy Information Agency (EIA), prices rose substantially in the first half of November because of high natural gas demand for heating and power generation. Cold weather across the Lower 48 states in mid-November increased natural gas demand in the residential and commercial sectors. Heating degree days (HDD) reached 14% above normal, the coldest November in the United States in four years. The higher demand contributed to several early-season withdrawals, which kept storage levels low heading into winter and put upward pressure on prices.

And the sell-off? Credit forecasts for milder weather heading into the holidays and the coming-back-to-earth estimates for increased short-term and 2019 gas production. Last week’s gas rig count last reached 198 (the highest since early-June) and current U.S. gas production stands at around 87 billion cubic feet per day (Bcf/d), well above the 78 Bcf/d that we saw this time last year.

Daily chart from this morning, (Dec. 14th 2018).Notice we broke the 50% retracement levelfrom the recent move up. Next supprt is at 365.9, current resistance for this market is 416.1
This chart was prepared using CQG Q Trader software, which you can demo for 14 days with real time data.
To access a free trial to the ALGOS shown in the chart ( DIAMONDS included) along with other tools, visit and sign up for a free trial for 21 days with real time data.

3. Economic Calendar

Source: Moore Research Center, Inc.

* Please note that the information contained in this letter is intended for clients, prospective clients, and audiences who have a basic understanding, familiarity, and interest in the futures markets.

** The material contained in this letter is of opinion only and does not guarantee any profits. These are risky markets and only risk capital should be used. Past performances are not necessarily indicative of future results.

*** This is not a solicitation of any order to buy or sell, but a current market view provided by Cannon Trading Inc. Any statement of facts herein contained are derived from sources believed to be reliable, but are not guaranteed as to accuracy, nor they purport to be complete. No responsibility is assumed with respect to any such statement or with respect to any expression of opinion herein contained. Readers are urged to exercise their own judgment in trading!